Which of the Following Is True Regarding Henry's Entitlement to Payment

question 46

Multiple Choice

Which of the following is true regarding Henry's entitlement to payment from Millie?

• A) Henry is only entitled to payment from Millie because Anne dishonored the payment.
• B) Henry is not entitled to payment from Millie unless Bob, in addition to Anne, dishonors the instrument.
• C) Henry is never entitled payment from Millie because he must seek recovery only from Anne.
• D) Henry is entitled to recover on the note from Millie.
• E) Henry is entitled to recover on the note from Millie only if both Anne and Bob have filed bankruptcy or are otherwise proven insolvent.

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Definitions:

Instrument

A written legal document that officially records a legally enforceable act, process, or contractual obligation, arrangement, or right.

Promissory Note

A legal instrument in which one party promises in writing to pay a determinate sum of money to the other, either at a fixed or determinable future time or on demand of the payee, under specific terms.

Primary Liability

Primary liability pertains to the direct and immediate obligation to fulfil a financial commitment or compensate for a loss.

Negotiable Instrument

A negotiable instrument is a written document guaranteeing the payment of a specific amount of money, either on demand or at a set time, with the payee able to transfer the instrument to another party.